Investment bank TD Cowen warns: Trump's encryption business may hinder U.S. regulatory legislation, political risks are rising.

On April 16, TheBlock reported that investment bank TD Cowen noted that the Trump family’s crypto business, including the planned launch of stablecoins, could trigger a backlash and delay the U.S. regulatory process, and that political risks are climbing despite lawmakers accelerating crypto regulations. Jaret Seiberg, head of TD Cowen’s Washington research team, wrote in a report on Monday: “We are concerned that the political threat could escalate enough to undermine legislative and regulatory reform in the crypto space. While we don’t see the political risks of radically disrupting the crypto industry, the risks are rising, not falling, and that’s what we think investors need to keep an eye on.” Currently, lawmakers and regulators in Washington are making progress in developing crypto legislation and guidelines. The U.S. Securities and Exchange Commission (SEC) has dropped a number of crypto lawsuits, and lawmakers are envisioning a regulatory framework for stablecoins and market structures. Last week, acting SEC Chairman Mark Uyeda also hinted that the SEC may offer waiver relief to crypto trading platforms as well as traditional exchanges looking to trade tokenized securities, Seiberg mentioned. However, Seiberg said the momentum could be threatened by the controversy over the Trump family’s foray into the crypto space, including its planned stablecoin. “We are increasingly concerned that the Trump family’s business practices and its government actions could provoke a backlash that could derail aggressive government action.” Seiberg also pointed to concerns about the Trump administration’s anti-money laundering policy shifts, such as the lifting of sanctions on crypto mixer Tornado Cash and the DOJ’s reduction in prosecutions in crypto money laundering cases.